Herbalifehttp://www.businessinsider.com/category/herbalife
en-usWed, 13 Dec 2017 22:41:17 -0500Wed, 13 Dec 2017 22:41:17 -0500The latest news on Herbalife from Business Insiderhttp://static3.businessinsider.com/assets/images/bilogo-250x36-wide-rev.pngBusiness Insiderhttp://www.businessinsider.com
http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10Short seller Andrew Left says he's found a 'business dirtier than Herbalife'http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10
Sun, 08 Oct 2017 10:05:00 -0400Business Insider
<p><img style="float:right;" src="http://static3.businessinsider.com/image/59d4f3f3351ccf89468b73aa-438/screen%20shot%202017-10-04%20at%20104356%20am.png" alt="Andrew Left Citron Shopify" data-mce-source="YouTube" data-link="https://www.youtube.com/watch?v=O8mNanfNNLw"></p><p><a href="http://www.businessinsider.com/category/andrew-left" target="_blank" rel="noopener noreferrer">Andrew Left</a> is back at it again.</p>
<p>The Citron Research founder tweeted on Wednesday that the Canadian e-commerce company <a href="http://markets.businessinsider.com/stock/SHOP-Quote" target="_blank" rel="noopener noreferrer">Shopify</a> was a "business dirtier than Herbalife."</p>
<p>He also posted a seven-minute <a href="https://www.youtube.com/watch?v=O8mNanfNNLw" target="_blank" rel="noopener noreferrer">YouTube video</a> outlining his bear case, titled "Citron Exposes the Dark Side of Shopify — The FTC Will Take Notice," and <a href="http://www.citronresearch.com/citron-exposes-the-dark-side-of-shopify/" target="_blank" rel="noopener noreferrer">posted a report</a> to his firm's website.</p>
<p>In the video, Left lays out the big question he has around the company: Outside the roughly 50,000 verifiable merchants working with Shopify, who are the other 450,000 the company says it has? According to Left, many of them are, among other things, influencers paid to promote the company.</p>
<p>"Shopify, a company that has mastered the good ol' get-rich-quick scheme," Left says in the video. "What's never discussed by Wall Street is the real business behind Shopify."</p>
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<a href="https://twitter.com/search?q=%24SHOP&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$SHOP</a> a business dirtier than <a href="https://twitter.com/search?q=%24HLF&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$HLF</a> If the company has 2,500 plus merchants and 25k advanced...who are other 470k merchants? <a href="https://twitter.com/FTC?ref_src=twsrc%5Etfw">@FTC</a> </p>— Citron Research (@CitronResearch) <a href="https://twitter.com/mims/statuses/915574475957067777?ref_src=twsrc%5Etfw">October 4, 2017</a>
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<p>Left placed a price target of $60 on Shopify's stock, which is roughly 49% below the Tuesday closing price. Shopify's stock plunged as much as 14% on Wednesday.</p>
<p>And while the merits of Left's claims are certainly up for debate, Shopify's stock plunge proves once again that when Left speaks out against a company, the market listens.</p>
<p>Past targets of Left's have included <a href="http://www.businessinsider.com/citron-andrew-left-short-express-scripts-2016-12" target="_blank" rel="noopener noreferrer">Express Scripts</a>, which he said in December could be targeted during the Trump administration, and <a href="http://www.businessinsider.com/citron-research-andrew-left-shorting-chemours-2016-6" target="_blank" rel="noopener noreferrer">The Chemours Co.</a>, a DuPont spin-off he warned might be bankrupted by a class-action lawsuit.</p>
<p>But Left is perhaps best known for his <a href="http://www.businessinsider.com/valeant-shares-crash-october-21-2015-10" target="_blank" rel="noopener noreferrer">damning October 2015 report</a> that <a href="http://www.businessinsider.com/a-short-selling-firm-is-accusing-valeant-of-being-enron-and-it-says-it-has-proof-2015-10" target="_blank" rel="noopener noreferrer">accused Valeant Pharmaceuticals of being a "pharmaceutical Enron,"</a> and he helped bring up questions regarding the firm's accounting and relationship with the specialty pharmacy Philidor.</p>
<h3><a href="http://www.citronresearch.com/citron-exposes-the-dark-side-of-shopify/" target="_blank" rel="noopener noreferrer">Read the full Citron Research report here</a></h3>
<p><img style="display: block; margin-left: auto; margin-right: auto;" src="http://static2.businessinsider.com/image/59d52d4f351ccf89468b781a-854/screen%20shot%202017-10-04%20at%2024701%20pm.png" alt="Screen Shot 2017 10 04 at 2.47.01 PM" data-mce-source="Markets Insider" data-link="http://markets.businessinsider.com/stock/SHOP-Quote"></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/stock-market-news-hedge-funds-bearish-on-tech-stocks-2017-10" >Hedge funds are turning their backs on tech stocks</a></strong></p>
<p><a href="http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/bond-etfs-growing-in-popularity-2017-11">One type of ETF is taking over the market</a></p> http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10Short seller Andrew Left says he's found a 'business dirtier than Herbalife'http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10
Wed, 04 Oct 2017 11:25:33 -0400Joe Ciolli
<p><img style="float:right;" src="http://static3.businessinsider.com/image/59d4f3f3351ccf89468b73aa-438/screen%20shot%202017-10-04%20at%20104356%20am.png" alt="Andrew Left Citron Shopify" data-mce-source="YouTube" data-link="https://www.youtube.com/watch?v=O8mNanfNNLw"></p><p><a href="http://www.businessinsider.com/category/andrew-left" target="_blank" rel="noopener noreferrer">Andrew Left</a> is back at it again.</p>
<p>The Citron Research founder tweeted on Wednesday that the Canadian e-commerce company <a href="http://markets.businessinsider.com/stock/SHOP-Quote" target="_blank" rel="noopener noreferrer">Shopify</a> was a "business dirtier than Herbalife."</p>
<p>He also posted a seven-minute <a href="https://www.youtube.com/watch?v=O8mNanfNNLw" target="_blank" rel="noopener noreferrer">YouTube video</a> outlining his bear case, titled "Citron Exposes the Dark Side of Shopify — The FTC Will Take Notice," and <a href="http://www.citronresearch.com/citron-exposes-the-dark-side-of-shopify/" target="_blank" rel="noopener noreferrer">posted a report</a> to his firm's website.</p>
<p>In the video, Left lays out the big question he has around the company: Outside the roughly 50,000 verifiable merchants working with Shopify, who are the other 450,000 the company says it has? According to Left, many of them are, among other things, influencers paid to promote the company.</p>
<p>"Shopify, a company that has mastered the good ol' get-rich-quick scheme," Left says in the video. "What's never discussed by Wall Street is the real business behind Shopify."</p>
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<p lang="en" dir="ltr">
<a href="https://twitter.com/search?q=%24SHOP&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$SHOP</a> a business dirtier than <a href="https://twitter.com/search?q=%24HLF&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$HLF</a> If the company has 2,500 plus merchants and 25k advanced...who are other 470k merchants? <a href="https://twitter.com/FTC?ref_src=twsrc%5Etfw">@FTC</a> </p>— Citron Research (@CitronResearch) <a href="https://twitter.com/mims/statuses/915574475957067777?ref_src=twsrc%5Etfw">October 4, 2017</a>
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<p>Left placed a price target of $60 on Shopify's stock, which is roughly 49% below the Tuesday closing price. Shopify's stock plunged as much as 14% on Wednesday.</p>
<p>And while the merits of Left's claims are certainly up for debate, Shopify's stock plunge proves once again that when Left speaks out against a company, the market listens.</p>
<p>Past targets of Left's have included <a href="http://www.businessinsider.com/citron-andrew-left-short-express-scripts-2016-12" target="_blank" rel="noopener noreferrer">Express Scripts</a>, which he said in December could be targeted during the Trump administration, and <a href="http://www.businessinsider.com/citron-research-andrew-left-shorting-chemours-2016-6" target="_blank" rel="noopener noreferrer">The Chemours Co.</a>, a DuPont spin-off he warned might be bankrupted by a class-action lawsuit.</p>
<p>But Left is perhaps best known for his <a href="http://www.businessinsider.com/valeant-shares-crash-october-21-2015-10" target="_blank" rel="noopener noreferrer">damning October 2015 report</a> that <a href="http://www.businessinsider.com/a-short-selling-firm-is-accusing-valeant-of-being-enron-and-it-says-it-has-proof-2015-10" target="_blank" rel="noopener noreferrer">accused Valeant Pharmaceuticals of being a "pharmaceutical Enron,"</a> and he helped bring up questions regarding the firm's accounting and relationship with the specialty pharmacy Philidor.</p>
<h3><a href="http://www.citronresearch.com/citron-exposes-the-dark-side-of-shopify/" target="_blank" rel="noopener noreferrer">Read the full Citron Research report here</a></h3>
<p><img style="display: block; margin-left: auto; margin-right: auto;" src="http://static2.businessinsider.com/image/59d52d4f351ccf89468b781a-854/screen%20shot%202017-10-04%20at%2024701%20pm.png" alt="Screen Shot 2017 10 04 at 2.47.01 PM" data-mce-source="Markets Insider" data-link="http://markets.businessinsider.com/stock/SHOP-Quote"></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/stock-market-news-hedge-funds-bearish-on-tech-stocks-2017-10" >Hedge funds are turning their backs on tech stocks</a></strong></p>
<p><a href="http://www.businessinsider.com/shopify-citron-andrew-left-business-dirtier-than-herbalife-2017-10#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/this-is-why-you-should-be-buying-gold-2017-11">This is why you should be buying gold</a></p> http://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-dutch-auction-2017-8Herbalife has a plan that could 'squeeze' hedge fund billionaire Bill Ackmanhttp://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-dutch-auction-2017-8
Sun, 27 Aug 2017 10:01:00 -0400Joe Ciolli
<p>Hedge fund billionaire <a href="http://www.businessinsider.com/category/bill-ackman">Bill Ackman</a>'s short position in <a href="http://markets.businessinsider.com/stock/HLF-Quote">Herbalife</a> is looking awfully shaky.</p>
<p>First and foremost, the company's surging stock &mdash; up 11% over two days after a report that it <a href="http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8">held talks to go private</a>&nbsp;&mdash; has cost the Ackman-led Pershing Square Capital Management roughly $115 million on a mark-to-market basis, according to data compiled by the financial-analytics provider <a href="https://www.s3partners.net/">S3 Partners</a>.</p>
<p>And Ackman could be in for more pain because of Herbalife's decision to execute a so-called <a href="http://ir.herbalife.com/releasedetail.cfm?ReleaseID=1037767">modified Dutch auction</a>, through which the company plans to buy back $600 million in shares at $60 to $68 a pop. Beyond that, all shareholders who sell back their stock will get an additional cash payment if Herbalife is acquired at a higher price than the auction range in the next two years.</p>
<p>The buyback of 8.8 million to 10 million shares could "actually squeeze Ackman out of some of his shorts," S3 says. He first started accumulating his position five years ago while accusing Herbalife of operating as a pyramid scheme. S3 estimates that if the Dutch auction is fully tendered, Ackman could face 3 million to 5 million share-loan recalls. After all, he makes up roughly 75% of the company's short interest.</p>
<p>But it doesn't end there. Once the number of Herbalife shares available to be loaned plummets following the auction, the cost to borrow the company's stock will "increase dramatically" to 10% to 40% from about 2%, according to S3.</p>
<p>So to what extent will that hurt Ackman's wallet? He now pays about $63,000 a day in financing costs, but that could skyrocket to $300,000 to $1.2 million a day once the auction is complete, S3 says.</p>
<p><img src="http://static3.businessinsider.com/image/599dcff8614d791c008b5038-1201/8-23-17-herbalife-short-cotd.png" alt="8 23 17 herbalife short COTD" data-mce-source="S3 Partners" data-mce-caption="Short interest in Herbalife is up 28% this year, but bearish speculators have lost roughly $150 million over the past two days." data-link="https://www.s3partners.net/" /></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8" >Herbalife held talks to go private, and its stock is jumping</a></strong></p>
<p><a href="http://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-dutch-auction-2017-8#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-2017-8Herbalife has a plan that could 'squeeze' hedge fund billionaire Bill Ackmanhttp://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-2017-8
Wed, 23 Aug 2017 06:04:00 -0400Joe Ciolli
<p>Hedge fund billionaire <a href="http://www.businessinsider.com/category/bill-ackman">Bill Ackman</a>'s short position in <a href="http://markets.businessinsider.com/stock/HLF-Quote">Herbalife</a> is looking awfully shaky.</p>
<p>First and foremost, the company's surging stock &mdash; up 11% over two days after a report that it <a href="http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8">held talks to go private</a>&nbsp;&mdash; has cost the Ackman-led Pershing Square Capital Management roughly $115 million on a mark-to-market basis, according to data compiled by the financial-analytics provider <a href="https://www.s3partners.net/">S3 Partners</a>.</p>
<p>And Ackman could be in for more pain because of Herbalife's decision to execute a so-called <a href="http://ir.herbalife.com/releasedetail.cfm?ReleaseID=1037767">modified Dutch auction</a>, through which the company plans to buy back $600 million in shares at $60 to $68 a pop. Beyond that, all shareholders who sell back their stock will get an additional cash payment if Herbalife is acquired at a higher price than the auction range in the next two years.</p>
<p>The buyback of 8.8 million to 10 million shares could "actually squeeze Ackman out of some of his shorts," S3 says. He first started accumulating his position five years ago while accusing Herbalife of operating as a pyramid scheme. S3 estimates that if the Dutch auction is fully tendered, Ackman could face 3 million to 5 million share-loan recalls. After all, he makes up roughly 75% of the company's short interest.</p>
<p>But it doesn't end there. Once the number of Herbalife shares available to be loaned plummets following the auction, the cost to borrow the company's stock will "increase dramatically" to 10% to 40% from about 2%, according to S3.</p>
<p>So to what extent will that hurt Ackman's wallet? He now pays about $63,000 a day in financing costs, but that could skyrocket to $300,000 to $1.2 million a day once the auction is complete, S3 says.</p>
<p><img src="http://static3.businessinsider.com/image/599dcff8614d791c008b5038-1201/8-23-17-herbalife-short-cotd.png" alt="8 23 17 herbalife short COTD" data-mce-source="S3 Partners" data-mce-caption="Short interest in Herbalife is up 28% this year, but bearish speculators have lost roughly $150 million over the past two days." data-link="https://www.s3partners.net/" /></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8" >Herbalife held talks to go private, and its stock is jumping</a></strong></p>
<p><a href="http://www.businessinsider.com/herbalife-stock-price-bill-ackman-hedge-fund-short-squeeze-2017-8#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8Herbalife held talks to go private, and its stock is jumping (HLF)http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8
Mon, 21 Aug 2017 10:02:54 -0400Rachael Levy
<p><img style="float:right;" src="http://static4.businessinsider.com/image/599ae7a7f1a850c62a8b5fb8-882/screen shot 2017-08-21 at 95912 am.png" alt="Screen Shot 2017 08 21 at 9.59.12 AM" data-mce-source="Markets Insider" data-link="http://markets.businessinsider.com/stock/HLF-Quote" /></p><p></p>
<p>Herbalife shares were up about 8% Monday morning after the company disclosed that it had discussions to go private.</p>
<p>Herbalife also said in <a href="http://ir.herbalife.com/releasedetail.cfm?ReleaseID=1037767">a statement</a> Monday morning that it was offering a "modified Dutch auction" &mdash; buying back $600 million of shares at $60 to $68 a pop. The deal offers those who sell back their stock to get paid should Herbalife be acquired within two years.</p>
<p>The company said it decided to offer the stock tender after holding discussions with a private investor, though those talks were terminated August 16.</p>
<p>Carl Icahn and his entities are the largest shareholders, and are not allowed to increase their ownership above 50% of Herbalife's standing shares unless they buy all of them, the statement added.</p>
<p>Icahn and Herbalife's board and executive officers do not plan to tender their shares, the company said.</p>
<p>The surge in Herbalife's stock price is a blow to Bill Ackman's Pershing Square Capital, the activist fund that went short on the supplements company five years ago while accusing it of operating as a pyramid scheme. Pershing Square's bet has largely gone the wrong way since it was put on.</p>
<p>A Pershing Square spokesman declined to comment. Icahn couldn't immediately be reached for comment.</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/how-goldman-sachs-is-different-than-a-hedge-fund-2017-6" >How working at Goldman Sachs is different from a hedge fund</a></strong></p>
<p><a href="http://www.businessinsider.com/herbalife-held-talks-to-go-private-and-its-stock-is-jumping-2017-8#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/cryptocurrency-value-explained-by-crypto-hedge-fund-cio-ari-paul-2017-11">The CIO of a crypto hedge fund explains the value in cryptocurrency — and why the market will explode over the next 2 years</a></p> http://www.businessinsider.com/traders-are-piling-into-bill-ackmans-favorite-short-bet-2017-6Traders are piling into Bill Ackman's favorite short bet (HLF)http://www.businessinsider.com/traders-are-piling-into-bill-ackmans-favorite-short-bet-2017-6
Wed, 07 Jun 2017 09:10:00 -0400Joe Ciolli
<p><img style="float:right;" src="http://static1.businessinsider.com/image/5937fac5d508f820008b4888-905/rtx36ij5.jpg" alt="bill ackman" data-mce-source="Reuters / Richard Brian" data-mce-caption="Bill Ackman, chief executive officer and portfolio manager at Pershing Square Capital Management, speaks during the SALT conference in Las Vegas, Nevada, U.S. May 18, 2017."></p><p>Hedge fund manager Bill Ackman, the outspoken critic of Herbalife who publicly bet $1 billion against the company, took his share of lumps as the stock price failed to cooperate.</p>
<p>Now that Herbalife's shares have started to weaken, finally allowing the Pershing Square Capital Management founder to make back some money on the wager, he finds himself with plenty of company.</p>
<p>Short interest on Herbalife sits at $1.8 billion — up $635 million, or 55%, for the year, according to data compiled by the financial-analytics firm <a href="https://www.s3partners.net/">S3 Partners</a>. The measure is approaching a historical high of $2 billion set in July 2013.</p>
<p>Those short positions have yielded $106 million in mark-to-market profit in the past two days alone as the stock has slipped by 5.7%. Two-thirds of that belongs to Ackman, S3 says.</p>
<p>So why did Herbalife's stock price start cooperating with Ackman's bearish view? On Monday, the company trimmed its full-year forecast, saying revenue would grow by just 0.5% to 3.5% in 2017, down from an estimate of 6% in May. It also foresees a year-over-year sales decline of as much as 6% in the second quarter.</p>
<p>The adjustments are a direct result of last year's settlement with the Federal Trade Commission, which made Herbalife change its business model and pay $200 million for distributor refunds.</p>
<p>The subsequent share weakness is a result that Ackman has struggled to will into existence since he first called Herbalife a pyramid scheme in a scathing research report in December 2012. He doubled down in July 2014, giving a widely publicized <a href="http://www.businessinsider.com/bill-ackman-herbalife-presentation-2014-7">presentation</a> arguing why Herbalife should go to zero.</p>
<p>But as Ackman found out the hard way during the period since his first public rebuke of Herbalife, the company's shares are surprisingly resilient, making it a risky short bet.</p>
<p>Herbalife surged by 124% from the start of 2013 through Friday, experiencing periods of strength that undoubtedly squeezed short positions and caused pain for Herbalife bears. To add insult to injury for Ackman specifically, the stock rallied by 15% during his ill-fated 2014 slideshow.</p>
<p>But with Herbalife's newly tempered forward guidance, the tide may be shifting in his favor — as long as traders don't cover their bearish wagers, as they have the past two times when short interest was this high. S3 thinks it could be different this time.</p>
<p>"With HLF's management revising forward looking revenue guidance lower, shorts may stay in their positions longer in order to see the impact of continued FTC compliance," Ihor Dusaniwsky, the head of research at S3, wrote in a client note.</p>
<p><img src="http://static6.businessinsider.com/image/5937f73cd508f821038b4820-690/screen shot 2017-06-07 at 85253 am.png" alt="HLF share price" data-mce-source="Markets Insider"></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/put-to-call-ratio-just-got-its-most-bullish-reading-of-the-year-2017-6" >A crucial stock market signal just got its most bullish reading of the year</a></strong></p>
<p><a href="http://www.businessinsider.com/traders-are-piling-into-bill-ackmans-favorite-short-bet-2017-6#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/this-is-why-you-should-be-buying-gold-2017-11">This is why you should be buying gold</a></p> http://www.businessinsider.com/herbalife-raises-its-profit-forecast-and-says-it-met-a-key-ftc-threshold-2017-6Herbalife raises its profit forecast and says it met a key FTC threshold (HLF)http://www.businessinsider.com/herbalife-raises-its-profit-forecast-and-says-it-met-a-key-ftc-threshold-2017-6
Mon, 05 Jun 2017 06:52:00 -0400Subrat Patnaik
<p><img style="float:right;" src="http://static2.businessinsider.com/image/5935377ab74af41f008b63d1-711/herbalife-ceo-johnson-talks-obesity-fake-news-at-milken-conference-2017-5.jpg" alt="Michael O. Johnson, Chairman and CEO, Herbalife Nutrition, speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., May 2, 2017. REUTERS/Lucy Nicholson" data-mce-source="Thomson Reuters" data-mce-caption="Michael O. Johnson, Chairman and CEO, Herbalife Nutrition, speaks during the Milken Institute Global Conference in Beverly Hills"></p><p>(Reuters) - Nutritional supplement maker Herbalife Ltd on Sunday raised its current-quarter adjusted profit forecast and said it exceeded a key threshold under its agreement with the U.S. Federal Trade Commission.</p>
<p>Herbalife now expects adjusted profit of 95 cents-$1.15 per share in the second quarter ending June 30, compared to the 88 cents-$1.08 per share it expected earlier.</p>
<p>However, the company said it expected sales to fall by 6-2 percent due to the transition to the new FTC rules in the U.S. along with softness in its Mexico business. Herbalife had earlier expected sales to fall by 4.5-0.5 percent.</p>
<p>The Los Angeles-based company also said that 90 percent of sales in the United States in May were documented purchases by consumers, exceeding the 80 percent threshold called for in its agreement with FTC.</p>
<p>"These figures should put an end to any questions regarding demand for our nutrition products and the strength of our go-to-market business model," Chief Executive Richard Goudis said.</p>
<p>Herbalife, which has been accused by billionaire investor William Ackman of being a pyramid scheme, agreed to pay $200 million and change the way it does business to avoid being labeled as such by regulators.</p>
<p>In December 2012, hedge-fund manager William Ackman unveiled a $1 billion short position against Herbalife in a withering, hours-long presentation.</p>
<p>Ackman has accused the company of being an illegal pyramid scheme numerous times, and even starred in a recent documentary about Herbalife called "Betting on Zero" to explain his position. But as it stands, he is losing out.</p>
<p><a href="http://cnb.cx/2qWkGu6">CNBC first reported</a> about Herbalife's outlook earlier on Sunday. (Reporting by Subrat Patnaik in Bengaluru; Editing by Sunil Nair)</p><p><a href="http://www.businessinsider.com/herbalife-raises-its-profit-forecast-and-says-it-met-a-key-ftc-threshold-2017-6#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/great-pyramid-of-cholula-worlds-largest-pyramid-2016-9">The world's largest pyramid is not in Egypt</a></p> http://www.businessinsider.com/herbalife-is-sliding-after-naming-a-new-ceo-2016-11Herbalife is sliding after naming a new CEO (HLF)http://www.businessinsider.com/herbalife-is-sliding-after-naming-a-new-ceo-2016-11
Tue, 01 Nov 2016 16:18:10 -0400Bob Bryan
<p><img style="float:right;" src="http://static3.businessinsider.com/image/56d82e156e97c630008bb0f1-1024/21688729261_3e1090b8bf_b.jpg" alt="herbalife" data-mce-source="HERBALIFE (Independent Distributor)/Flickr" data-link="https://www.flickr.com/photos/goherb/21688729261/in/photolist-z3ypzX-nGG4bz-noq72E-geMxDC-noq673-bCsSZb-qt9JHK-oDxp5R-jaWKWq-bRnzL8-mSyGr1-nEUEBp-poPAXG-bCsT8q-qkCAVv-bRofSR-bCsTgh-hXXo2w-mbcd64-nUdaix-arYbCi-dR8c7A-jzBJB5-bRnAnp-oBmsiP-fH9vts-y66qQi-pP776o-qd1koq-bufyY2-y5CEWQ-dMhE4o-qEvjjc-qtkg2p-uiLqLs-mbdLHr-mbcb3P-61sceL-4wdw5p-agCacJ-arYbkk-bCtymj-rdJTS1-61scVs-61sc6m-mbejv5-rjv3Y7-qFvsWo-61o1SV-yKbpcW" /></p><p>Herbalife, the nutritional supplement firm, said it is naming a new CEO.</p>
<p>The firm <a href="http://ir.herbalife.com/releasedetail.cfm?ReleaseID=996799">said that current</a> CEO Michael Johnson will shift to Executive Chairman as of June 1, 2017 and be replaced by COO Richard Goudis.</p>
<p>The firm also reported earnings, beating on profits but <a href="http://ir.herbalife.com/releasedetail.cfm?ReleaseID=996780">missing sales expectations</a>. For the third quarter, earnings per share came in at $1.21 per share against analyst estimates of $1.09 per share. Sales were light, however, at $1.12 billion against projections of $1.14 billion.</p>
<p>In a statement following the announcement, Carl Icahn, who holds a large stake in the firm, said he supports the move by Herbalife.</p>
<p>"<span>Almost four years ago, we became shareholders of Herbalife and now have five of our nominees on the Board," <a href="http://carlicahn.com/statement-regarding-herbalife/">wrote Icahn on his website.</a></span></p>
<p><span>"We would like to applaud Michael Johnson for doing a superb job navigating the company through a number of libelous attacks during this period. I am glad he intends to stay meaningfully involved in the company and I fully support the Board&rsquo;s choice of Rich Goudis becoming CEO while Michael remains actively engaged as Executive Chairman."</span></p>
<p>The firm has been a&nbsp;battleground for hedge fund giants Bill Ackman and Carl Icahn, who have taken opposite sides of the trade. Ackman has called the company a pyramid scheme and has been famously short, while Icahn has taken a long position.</p>
<p>Following the CEO news, the stock is sliding by a bit more than 3.5% to $57.00 a share.</p>
<p><img src="http://static2.businessinsider.com/image/5818f808b28a6477058b6205-964/screen shot 2016-11-01 at 4.15.31 pm.png" alt="Screen Shot 2016 11 01 at 4.15.31 PM" data-mce-source="Markets Insider" data-link="http://markets.businessinsider.com/stock/HLF-Quote" />&nbsp;</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/jeff-gundlach-total-return-bond-fund-redemptions-2016-11" >Investors pulled money from Jeff Gundlach's main fund for the first time since January 2014</a></strong></p>
<p><a href="http://www.businessinsider.com/herbalife-is-sliding-after-naming-a-new-ceo-2016-11#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/tech-finance-coinbase-buy-sell-trade-bitcoin-app-coinbase-2017-1">How to buy and sell bitcoin using one of the most popular cryptocurrency apps on the iPhone</a></p> http://www.businessinsider.com/carl-icahn-on-bill-ackman-herbalife-statement-liar-2016-8CARL ICAHN: Bill Ackman is a liarhttp://www.businessinsider.com/carl-icahn-on-bill-ackman-herbalife-statement-liar-2016-8
Fri, 26 Aug 2016 16:39:59 -0400Bob Bryan
<p><img style="float:right;" src="http://static1.businessinsider.com/image/5788fc7c4321f16c018b8895-840/icahn ackman_edited-1.jpg" alt="Carl Icahn Bill Ackman" data-mce-source="Reuters" /></p><p>Carl Icahn is sticking with his Herbalife investment.</p>
<p>In a <a href="http://carlicahn.com/carl-icahn-issues-statement-regarding-herbalife/">statement released on his website</a>, Icahn said that he had not sold any of his shares in the nutrition company and in fact upped his position by 2.3 million shares on Friday.</p>
<p>Bill Ackman of Pershing Square Capital, who has famously been betting against Herbalife's stock,&nbsp;went on CNBC earlier on Friday saying that he had been approached by Jefferies to purchase Icahn's stake in Herbalife.</p>
<p>"Look, I think he knows this thing is toast," Ackman told CNBC.</p>
<p>That followed a report from <a href="http://www.wsj.com/articles/carl-icahn-mulled-selling-herbalife-stake-to-group-that-included-bill-ackman-1472198581">The Wall Street Journal</a> that the hedge fund titan was considering selling his large investment.</p>
<p>In the statement, Icahn also took shots at Ackman. The two have famously feuded over their opposing positions in Herbalife&nbsp;for years.</p>
<p>Icahn said that Ackman had allowed his "obsession" with Herbalife's business model to cloud his investing judgment.</p>
<p>"<span>Ackman may be a smart guy but he has clearly succumbed to the same dangerous (and sometimes fatal) malady that afflicts many investors &ndash; he&rsquo;s developed a very bad case of Herbalife obsession'," said Icahn <a href="http://carlicahn.com/carl-icahn-issues-statement-regarding-herbalife/">in his statement.</a></span></p>
<p><span>Additionally, Icahn said that Ackman has no idea what his thinking was and had no right to go on CNBC and say that Icahn was selling his stake in Herbalife.</span></p>
<p><span>"<span>It amazes me that a guy who hasn&rsquo;t any knowledge of my internal investment thinking believes he is in a position to go on television to tell the world what I </span><strong><u>AM</u></strong><span> thinking!" said <a href="http://carlicahn.com/carl-icahn-issues-statement-regarding-herbalife/">Icahn in the statement (emphasis Icahn's).</a></span></span></p>
<p><span><span>"Amazing! He has no right to do so, and even worse, I&rsquo;m sure his unsubstantiated, obsessive comments, especially about Herbalife, have cost investors a great deal of money over the last few years."</span></span></p>
<p><span><span>Following the news, Herbalife shares are up 4% in after-hours trading.</span></span></p>
<p>Here's the full statement from Icahn:</p>
<p style="padding-left: 60px;"><span>"Over the years many investment bankers, including Jefferies, that specialize in block trades frequently make bids for our large positions. But completely contrary to what Bill Ackman stated on television today, I have never given Jefferies an order to sell any of our Herbalife shares. Last month we publicly disclosed that Herbalife granted us permission to go up to 35%. At the time of the disclosure, Ackman declared that I have no interest in increasing my position in Herbalife. This was obviously another misstatement of the facts by Ackman since today I bought another 2.3 million shares. I continue to believe in Herbalife:&nbsp; it&rsquo;s a great model that creates a great number of jobs for people. Ackman may be a smart guy but he has clearly succumbed to the same dangerous (and sometimes fatal) malady that afflicts many investors &ndash; he&rsquo;s developed a very bad case of 'Herbalife obsession'. Obsessions concerning the value of stocks are the undoing of many investors because they often blind you to the facts, and it becomes impossible to see the forest for the trees. Watching Ackman on television today is a perfect example of this &ldquo;obsession&rdquo;.&nbsp;&nbsp; A month ago he declared that I&rsquo;d never buy more Herbalife stock, which obviously turned out to be completely wrong. Today, he said I&rsquo;m done with my Herbalife investment and that I&rsquo;m a seller. Obviously wrong, again. It amazes me that a guy who hasn&rsquo;t any knowledge of my internal investment thinking believes he is in a position to go on television to tell the world what I </span><strong><u>AM</u></strong><span> thinking! Amazing! He has no right to do so, and even worse, I&rsquo;m sure his unsubstantiated, obsessive comments, especially about Herbalife, have cost investors a great deal of money over the last few years."</span></p><p><a href="http://www.businessinsider.com/carl-icahn-on-bill-ackman-herbalife-statement-liar-2016-8#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/jim-cramer-on-investing-individual-stocks-versus-index-funds-2015-12">JIM CRAMER: This is where you should invest your first $10,000</a></p> http://www.businessinsider.com/ackman-missing-the-point-on-icahn-and-herbalife-2016-8After three years of Herbalife, Bill Ackman still doesn't get Carl Icahnhttp://www.businessinsider.com/ackman-missing-the-point-on-icahn-and-herbalife-2016-8
Fri, 26 Aug 2016 15:05:56 -0400Linette Lopez
<p><img style="float:right;" src="http://static5.businessinsider.com/image/5102cfcc6bb3f7d73c00001b-1000/screen shot 2013-01-25 at 1.30.59 pm.jpg" alt="Bill ackman carl icahn CNBC" data-mce-source="CNBC" /></p><p>Bill Ackman is that guy at a basketball game who keeps chanting after everyone else has stopped.</p>
<p>Ackman is crowing over the fact that his nemesis, Carl Icahn, almost sold part of Icahn Enterprise's 18% stake in Herbalife to a consortium of buyers including himself, <a href="http://www.wsj.com/articles/carl-icahn-mulled-selling-herbalife-stake-to-group-that-included-bill-ackman-1472198581">as revealed by The Wall Street Journal</a>.</p>
<p>His exuberance shows he's missing a very important, but simple, point: For everyone but Ackman, the long, national nightmare that was his Herbalife crusade is over.</p>
<p>It's especially over for Icahn, because to beat Ackman, his longtime frenemy, Icahn doesn't need to see the stock thrive &mdash; it just has to survive.</p>
<p>And it looks like that is exactly what will happen.</p>
<p>In May, the Federal Trade Commission <a href="http://www.businessinsider.com/report-herbalife-ftc-agreement-2016-5">ordered Herbalife to pay a fine for abusive practices</a>. It stopped short, though, of accusing the company of being a pyramid scheme. Since 2013, Ackman has insisted that the firm is in fact a pyramid scheme and that he will short the company to zero.</p>
<p>Ackman maintains that the changes that Herbalife has to make to its business will eventually bring it down. In the meantime, though, Icahn is still holding his shares.</p>
<h2>To zero and beyond</h2>
<p>Almost immediately after the WSJ story hit the Street, Ackman went onto CNBC to talk about how Icahn's attempt to sell is a sign that he no longer has conviction in the controversial stock, and that he's made all the money he needs to make.</p>
<p>"Look, I think he knows the company is toast," Ackman said.</p>
<p>Ehhh, maybe. But the reality is that Icahn has rarely been a huge cheerleader for the stock. In fact, he's actually refused to talk about it in interviews. What he was always interested in was <em>the trade </em>and the fact that Ackman was on the other side of it.</p>
<p>Let's go back to the epic interview that catapulted this feud to fame, <a href="http://www.businessinsider.com/bill-ackman-on-cnbc-2013-1">that fateful day in January 2013</a> when Icahn and Ackman appeared on CNBC at the same time and literally let each other have it.</p>
<p>Ackman was ready to talk about the merits of his short position and his thesis about Herbalife's business.</p>
<p>Icahn was ready to talk about Ackman.</p>
<p>"Listen, you know, I've really sort of had it with this guy Ackman," Icahn told CNBC.</p>
<p>What followed will be forever recorded in the annals of Wall Street history. Icahn called Ackman a crybaby and said that Ackman reminded him of the little Jewish boys he'd beat up in the school yard during his rough-and-tumble childhood in Queens.</p>
<p>However, when it came to talking about Herbalife, people often forget that Icahn had absolutely nothing to say.</p>
<p>"I want to say what I want to say, and I'm not going to talk about my Herbalife position because you want to bully me," Icahn shouted at CNBC host Scott Wapner. "I don't give a damn about what you want to know."</p>
<p>"You can say what the hell you want. I'm going to talk about what Ackman just said about me, not about Herbalife ... I'll talk about Herbalife when I goddamn want to," Icahn continued. "I'm never going on a show with you again, that's for damn sure."</p>
<p><img src="http://static5.businessinsider.com/image/53c6f04cecad043e7cf996b7-1510/screen shot 2014-07-16 at 5.24.27 pm.png" alt="ackman icahn" data-mce-source="CNBC" /></p>
<h2>Why long? Why not?</h2>
<p>So after all of this &mdash; after years of calling Ackman's trade "disingenuous," after Icahn told Trish Regan at Bloomberg in 2013 that if Ackman wanted to badmouth a stock publicly he should <a href="http://www.businessinsider.com/icahn-shreds-ackman-on-bloomberg-tv-2013-1">"join the SEC" (shudder)</a>, after the two men called a truce on national television only for Icahn to buy Herbalife stock again &mdash; Icahn finally said a few nice, banal things about the company.</p>
<p>Well, at least a couple times.</p>
<p>Even <a href="http://www.businessinsider.com/icahn-says-ackman-wrong-on-herblife-2016-6">just before the FTC ruling</a>, Icahn's discussion of Herbalife centered on Ackman. The nicest thing he could say about Herbalife was that it creates jobs for people which &mdash; yeah, duh.</p>
<p>"Ackman is completely and totally wrong on this company," Icahn said. "You know, Ackman is a smart guy and all, but he is just dead wrong. This company creates work for a lot of people. And to say it doesn't is ridiculous."</p>
<p>For Ackman to believe in Icahn's conviction is like you, dear reader, asking your girlfriend or wife what she wants for Valentine's Day and actually believing her when she says "oh, nothing."</p>
<p>Naturally, we're not the only people who think this way. The entire market has been watching these two men duke it out for years. That may be why Herbalife's stock is down only 3% on the news that its biggest shareholders considered selling.</p>
<p>You see, to Icahn, the Herbalife trade is over because it looks as if he won and Ackman lost. Icahn has moved on.</p>
<p>We reached out to Icahn Enterprises for comment on this story, but we have yet to hear back. Maybe it's August, maybe they just have more interesting things to do.</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/what-the-heck-happened-to-bill-ackman-2014-7" >What the heck happened to Bill Ackman?</a></strong></p>
<p><a href="http://www.businessinsider.com/ackman-missing-the-point-on-icahn-and-herbalife-2016-8#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/millionaire-mistakes-grant-cardone-student-debt-saving-investing-2016-8">A self-made millionaire describes the financial mistakes to avoid if you want to get rich by 30</a></p> http://www.businessinsider.com/r-icahn-explored-selling-herbalife-stake-to-group-that-included-ackman-wsj-2016-8ACKMAN: 'If Carl sells, it can accelerate the demise of the company'http://www.businessinsider.com/r-icahn-explored-selling-herbalife-stake-to-group-that-included-ackman-wsj-2016-8
Fri, 26 Aug 2016 08:20:00 -0400Bob Bryan and Reuters
<p><img style="float:right;" src="http://static2.businessinsider.com/image/5788fc7c4321f16c018b8895-840/icahn%20ackman_edited-1.jpg" alt="Carl Icahn Bill Ackman" data-mce-source="Reuters"></p><p>Billionaire investor Carl Icahn was recently in talks to sell his stake in nutritional supplement maker Herbalife to a group that included hedge fund manager Bill Ackman, <a href="http://on.wsj.com/2bMkIA0">The Wall Street Journal reported</a>.</p>
<p>Investment bank Jefferies Group has been on the hunt for about a month to find buyers for Icahn's 18.3% stake in Herbalife, The Journal said, citing people familiar with the matter.</p>
<p>Icahn and Ackman had placed opposing bets on the Los Angeles-based company. Ackman for years has been betting against the company, accusing it of running a pyramid scheme.</p>
<p>The duo even became embroiled in a public war of words, with Icahn famously calling Ackman a "liar" and a "crybaby" in a CNBC interview in 2013. They have since made up.</p>
<p>In an interview with CNBC on Friday morning, Ackman said that he was approached about buying Icahn's stake and agreed to if there were other buyers.</p>
<p>Ackman said that he believed the Federal Trade Commission's recent statement on Herbalife was bad news for the company and would eventually lead to its demise. Icahn's large backing, Ackman told CNBC, was supporting the fortune of the firm especially since Icahn has five people on the board of directors. Thus without Icahn's backing, investors and even distributors would lose faith in the firm.</p>
<p>"This is a confidence game," Ackman told CNBC. "If Carl sells, it can accelerate the demise of a company."</p>
<p>Ackman also told CNBC that he considered buying the stake in order to accelerate this decline. According to Ackman, if he were to purchase Icahn's stock, it would most likely lose him money, but it would be worth it.</p>
<p>"I would spend $30 million to get Carl out, probably more," said Ackman.</p>
<p>He also cited other shareholders such as Dan Loeb and George Soros selling out of the company as examples of large investors losing interest and confidence in the stock.</p>
<p>Herbalife in mid-July agreed to pay $200 million and change the way it does business to avoid being labeled a pyramid scheme by the FTC.</p>
<p>Following the settlement, the company said its board had cleared the way for Icahn to boost his stake in the company to as much as 35%.</p>
<p>Check out part of the Ackman's exchange with CNBC:</p>
<p><div>
<blockquote class="twitter-video" data-lang="en">
<p lang="en" dir="ltr">Ackman on Icahn looking to sell <a href="https://twitter.com/search?q=%24HLF&amp;src=ctag">$HLF</a>: "I think that accelerates...the demise of the company" <a href="https://t.co/FqUqrHlwyD">https://t.co/FqUqrHlwyD</a> <a href="https://t.co/eqpo9z9HaJ">pic.twitter.com/eqpo9z9HaJ</a></p>— CNBC Now (@CNBCnow) <a href="https://twitter.com/CNBCnow/status/769146224091996160">August 26, 2016</a>
</blockquote>
<script async src="//platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/omega-advisors-steve-einhorn-on-us-economic-expansion-2016-8" >OMEGA: The stock market should rise for at least another 2 years</a></strong></p>
<p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/after-panama-papers-the-rich-move-to-marshall-islands-and-antigua-2016-8" >The rich are getting more secretive with their money</a></strong></p>
<p><a href="http://www.businessinsider.com/r-icahn-explored-selling-herbalife-stake-to-group-that-included-ackman-wsj-2016-8#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/r-ackman-cheers-as-fidelity-funds-unload-more-herbalife-shares-2016-8Ackman cheers as Fidelity funds unload more Herbalife shareshttp://www.businessinsider.com/r-ackman-cheers-as-fidelity-funds-unload-more-herbalife-shares-2016-8
Fri, 12 Aug 2016 17:31:00 -0400Svea Herbst-Bayliss and Tim McLaughlin
<p><img style="float:right;" src="http://static1.businessinsider.com/image/57ae2c035124c9ab733db3b7-450-300/ackman-cheers-as-fidelity-funds-unload-more-herbalife-shares-2016-8.jpg" alt="A Herbalife product is seen at a clinic in the Mission District in San Francisco, California April 29, 2013. REUTERS/Robert Galbraith" border="0" /></p><p>One of Herbalife's largest investors sold more of the company's stock, just weeks after the U.S. government told the protein shake maker to reorganize its business, according to a filing with the U.S. Securities and Exchange Commission.</p>
<p>In an SEC filing on Wednesday, Fidelity Investments, the second largest investor in Herbalife , said it had cut its stake in the firm to 7.4 million shares, a 14 percent reduction from the 8.6 million shares it reported owning at the end of June.</p>
<p>"The fact that Fidelity is selling is a good sign," said Bill Ackman, the billionaire hedge fund manager who bet $1 billion that Herbalife's stock would collapse.</p>
<p>Fidelity declined to comment.</p>
<p>The mutual fund's portfolio managers, including Steve Wymer of Fidelity Growth Company Fund, have been cooling on Herbalife in recent months. Boston-based Fidelity funds cut their stake in Herbalife by 26 percent in the second quarter, disclosures show.</p>
<p>Sales after the Federal Trade Commission fined Herbalife $200 million on July 15 could suggest sentiment may be souring more quickly on the $6 billion market cap nutrition and weight loss company.</p>
<p>The FTC ordered Herbalife to hire a monitor to track product sales and said the company had been deceiving hundreds of thousands of hopeful people.</p>
<p>Ackman, who has lobbied the government to shut Herbalife down, has called the company a pyramid scheme.</p>
<p>"There is no longer a bull case to be made for this stock," Ackman said on Thursday evening. With the stock price up 22 percent this year, he is sitting on several hundred million dollars of paper losses.</p>
<p>Ackman made his remarks after a screening of "Betting on Zero," a film that details his four-year battle with Herbalife.</p>
<p>Herbalife declined to comment, but the company's stock has rallied about 10 percent since the FTC fine was announced.</p>
<p>Other large investors, including Credit Suisse, Blue Mountain Capital Management and TIAA Cref Investment Management have also cut their stakes in the second quarter, according to new regulatory filings.</p>
<p>Some investors have loaded up on Herbalife, however, including William Blair Investment Management, which bought 1.5 million shares during the second quarter, SEC filings show.</p>
<p>Billionaire Carl Icahn, Herbalife's largest investor, has five representatives on the board. He owned 17 million shares on March 31 and has not yet released second-quarter holdings.</p>
<p>(Reporting by Svea Herbst-Bayliss; Editing by Tom Brown)</p><p><a href="http://www.businessinsider.com/r-ackman-cheers-as-fidelity-funds-unload-more-herbalife-shares-2016-8#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/pershing-q2-conference-call-herbalife-2016-7Bill Ackman's getting stomped, but man did his conference call sound like a victory laphttp://www.businessinsider.com/pershing-q2-conference-call-herbalife-2016-7
Wed, 20 Jul 2016 13:26:44 -0400Linette Lopez
<p><img style="float:right;" src="http://static2.businessinsider.com/image/578fb2134321f142368b961d-2400/ap_698344155679.jpg" alt="Bill Ackman" data-mce-source="Manuel Balce Ceneta/AP" data-link="http://www.apimages.com/metadata/Index/Valeant-Congress/83e621416cc84348ad39a9d17ec9e542/6/0" /></p><p>Bill Ackman's Pershing Square is still having an utterly wretched year.</p>
<p>In a conference call to investors on Wednesday, he disclosed that his private funds are down 14% year to date, while Pershing Square Holdings is down 18% (thank leverage). The funds are up 3-3.5% for the month.</p>
<p>On the call, Ackman addressed a Fortune story that reported that his <a href="http://fortune.com/2016/07/19/ackman-investors-withdrawals/">investors have withdrawn $600 million</a> from his funds for the year, totaling about 5% of Pershing Square's $12 billion in assets.</p>
<p>That may seem like a lot to the casual Wall Street observer, especially given Ackman's notoriously stringent investor lock-ups, but he doesn't see it that way.</p>
<p>"The way we think about redemptions," Ackman said, "is as a percentage of capital."</p>
<p>And, if you look at it that way, of the last eight years, 2016 represents the sixth lowest in terms of redemptions &mdash; 37% lower than the last eight years, actually.</p>
<p>"My guess is the redemptions we've received as a percentage of capital are some of the lowest in the industry," he said. "We appreciate that support [from investors], and it has allowed us to be very effective and take a long-term view."</p>
<h2>'The FTC really set them up to fail,' he said on the call.</h2>
<p>Ackman's winning positions were Mondelez, Howard Hughes, Restaurant Brands, Fannie Mae, and Freddie Mac.</p>
<p>His losing positions were Nomad, Air Products, and Valeant Pharmaceuticals, which is down a whopping 26.5% for the year and makes up 6% of Pershing Square's portfolio.</p>
<p>Oh, and then there's Herbalife.</p>
<p>On Friday, the <a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7">Federal Trade Commission ruled that Herbalife</a>, while not officially an illegal pyramid scheme, would have to pay a $200 million fine and change its business practices going forward.</p>
<p>Ackman spent about 45 minutes of the call explaining that all of that was just semantics. The way he sees it, Herbalife's punishment is enough to fell the company.</p>
<p>"We believe the implementation of the settlement will cause the pyramid scheme to collapse," he said.</p>
<p>Herbalife, for its part, does not.</p>
<p>"After two years of working with the FTC, I think we understand the terms of the settlement agreement very well. We would not have settled unless we had the greatest confidence in our ability to thrive and we believe this will be proven out in a little more than a year from now when we release our results after implementation," Alan Hoffman, executive vice president of global corporate affairs for Herbalife, said in a statement.</p>
<p>Regardless, that means to Ackman that this crusade &mdash; which has gone on for three and a half years and drawn Ackman's archfrenemy Carl Icahn to the other side of the trade &mdash; is continuing, at least in Ackman's mind.</p>
<p>And so he returned to something Wall Street has become all too familiar with since December 2012, when he announced the company would go to zero &mdash; a long, detailed presentation of why Herbalife is a pyramid scheme, if not in name, then definitely in practice.</p>
<p>Here's a key slide:</p>
<p><img src="http://static4.businessinsider.com/image/578fae8d4321f1480f8b97ff-1425/screen shot 2016-07-20 at 11.30.23 am.png" alt="hlf slide bill ackman pershing square" data-mce-source="Pershing Square" /></p>
<p>And another one, which explains why Herbalife won't be able to survive once it complies with the FTC's settlement:</p>
<p><img src="http://static3.businessinsider.com/image/578faec94321f16b018b991d-1437/screen shot 2016-07-20 at 12.06.41 pm.png" alt="herbalife slide ackman" data-mce-source="Pershing Square" /></p>
<p>Ackman thinks three key things are worth paying attention to:</p>
<ol>
<li>He thinks Carl Icahn is going to get off his back and stop buying Herbalife stock: "I don't think Icahn plans to go up to 35% ... I think it's part of the manipulation," he said.</li>
<li>He believes Herbalife has already violated the terms of its FTC settlement by continuing to distribute marketing materials that claim you can get rich by joining its sales program.</li>
<li>"It's harder to start an Herbalife business than it is to open a McDonald's," Ackman said on the call. He thinks settlement compliance costs will be higher than Herbalife has estimated. Plus, no one would want to join their salesforce after the settlement because the company has to change its compensation structure and only compensate when a product has been sold to buyers outside the Herbalife system. He calls those "real customers."</li>
</ol>
<p>"Herbalife has already been shut down by the FTC. They just haven't realized it yet," he said.</p>
<p>Imagine the delusion.</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/short-selling-is-about-timing-2016-7" >The Herbalife saga shows that Bill Ackman thinks he's too good for short selling</a></strong></p>
<p><a href="http://www.businessinsider.com/pershing-q2-conference-call-herbalife-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/warren-buffett-modest-home-bought-31500-looks-2017-6">Warren Buffett lives in a modest house that's worth .001% of his total wealth — here's what it looks like</a></p> http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7The epic war between Bill Ackman and Carl Icahn is over, and Icahn won (HLF)http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7
Sun, 17 Jul 2016 08:43:00 -0400Business Insider
<p><img style="float:right;" src="http://static2.businessinsider.com/image/5788fc7c4321f16c018b8895-840/icahn%20ackman_edited-1.jpg" alt="Carl Icahn Bill Ackman" data-mce-source="Reuters"></p><p>Bad news for Bill Ackman.</p>
<p>The Federal Trade Commission on Friday <a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7">reached an agreement with multilevel marketing firm Herbalife, that kept it from being labeled a pyramid scheme</a>.</p>
<p><span>Ackman, the founder of Pershing Square Capital Management, has been short Herbalife <a href="http://www.businessinsider.com/bill-ackmans-herbalife-presentation-2012-12">since December 2012</a>, when he made a $1 billion bet that the stock would go to $0 and began a campaign to convince regulators and investors of wrongdoing by the company.</span></p>
<p>Fellow billionaire and activist investor Carl Icahn <a href="http://www.businessinsider.com/carl-icahn-is-long-herbalife-2013-1">took the other side of that bet</a> several weeks later.</p>
<p>Their opposing views on the company have led to some heated exchanges, including a January 2013 conversation on CNBC in which Icahn called Ackman a "crybaby" on live television. <br><br><div>
<iframe width="854" height="480" src="//www.youtube.com/embed/hCZRk1lL90Q" frameborder="0" allowfullscreen></iframe>
</div></p>
<p>They have since de-escalated, <a href="http://www.businessinsider.com/bill-ackman-and-carl-icahn-are-on-stage-at-a-huge-hedge-fund-conference-2014-7">hugging on stage</a> at a conference in 2014.</p>
<p>And Herbalife wasn't let completely off the hook by the FTC.<span> The company</span> must pay $200 million to settle charges and abandon incentives that reward distributors primarily for recruiting rather than sales. It also has to change some marketing practices.</p>
<p><span>The FTC's complaint showed that half of Herbalife's top sales leaders earned less than $300 on average in 2014 and were encouraged to recruit more sellers regardless of whether there was consumer demand.</span></p>
<p>So, Ackman — who had made the recruitment of sellers a key plank in his effort to have it deemed a pyramid scheme — was partially vindicated. </p>
<p>But lets remember that this is about investment profits. And on that front the outcome is clear.</p>
<p>Herbalife's shares jumped nearly 20% following the news Friday, and they're up nearly 70% since just before Ackman's short position became public.</p>
<h2>Icahn wins this one </h2>
<p>Icahn, who is now the company's largest shareholder with an 18% stake, has been granted permission to own as much as 35%.</p>
<p>"<span>While Bill Ackman and I are on friendly terms, we have agreed to disagree (vehemently) on this subject," Icahn said in a </span><a href="http://carlicahn.com/carl-icahn-issues-statement-in-response-to-herbalifes-settlement-with-the-ftc/">statement</a> released Friday<span>. "Simply stated, the shorts have been completely wrong on Herbalife."</span></p>
<p><span>In a statement released Friday, Ackman said that the FTC's findings still constitute a pyramid scheme, despite the regulator not using that term.</span></p>
<p><span>"We expect that once Herbalife's business restructuring is fully implemented, these fundamental structural changes will cause the pyramid to collapse as top distributors and others take their downlines elsewhere or otherwise quit the business," he said.</span></p>
<p><span>That mirrored what he had said on Thursday.</span></p>
<p><span>"Every day thousands of Herbalife distributors go on the web to host webinars and they attempt to recruit people with false and misleading statements about the potential of Herbalife business opportunities," Ackman said on <a href="http://video.cnbc.com/gallery/?video=3000534409">CNBC's Halftime Report</a>.</span></p>
<p><span>He referenced the $200 million settlement number that Herbalife had previously hinted at, adding:</span></p>
<p style="padding-left: 30px;"><span>"That's what they would be willing to pay in a mutual resolution. <strong>That's not what the government is willing to accept.</strong> That's what they have apparently thrown out as a number they're willing to pay. The reality here is this is not going to be about a dollar amount that Herbalife pays to the government to resolve this. The only way this thing gets resolved in my opinion is if Herbalife make material changes to their incentive structure to stop the incentives to recruit and my guess is that's what the government is pushing for. <strong>Herbalife realizes it can't accept those changes or they'll go bankrupt because no one is actually buying the product — you can't make money selling the product at retail. This is going to end up with the government suing Herbalife for being a pyramid scheme or Herbalife capitulating and agreeing to changes.</strong> And in either circumstance, the stock is not going to be $60 a share and trading at 14.5x earnings. That's why, certainly, we've been a patient investor here. I think this is the most attractive Herbalife has been from a risk rewards standpoint and that's why we've stayed short. And if we felt it wasn't an attractive investment we would have covered a long time ago."</span></p>
<p><span>Herbalife's shares have increased from $42.50 on December 18, 2012, the day before Ackman confirmed his short position, to <span>about $71 around 10 a.m. ET Friday. </span></span></p>
<p><span><span><img src="http://static5.businessinsider.com/image/5788ef6688e4a779638b7fe9-1236/screen_shot_2016-07-15_at_10_03_35_am.jpg" alt="Screen_Shot_2016 07 15_at_10_03_35_AM" data-mce-source="Yahoo! Finance"></span></span></p>
<p>Here's Icahn's full statement:</p>
<p style="padding-left: 30px;">"I have always believed in Herbalife’s strong fundamentals and am pleased the Board has decided to increase my ownership limit from 25% to 34.99% of the Company’s outstanding shares. A significant part of my investment success is directly tied to our in-depth investment research and understanding of often complex and unique issues facing companies. One can be sure that this was the case with Herbalife where we spent considerable time and resources studying the false pyramid scheme accusations made against the Company. Unlike many of those that “shorted” Herbalife, we did not rely on one or two research papers prepared by non-experts. As a result of our research, over three years ago we concluded that Herbalife was not a pyramid scheme. The FTC settlement announced today, coming after a two-year investigation also concluded that Herbalife is not a pyramid scheme – a conclusion that obviously vindicates our research and conviction. While Bill Ackman and I are on friendly terms, we have agreed to disagree (vehemently) on this subject. Simply stated the shorts have been completely wrong on Herbalife. Now that the Company has reached a settlement with the FTC, it is time to consider a range of strategic opportunities, including potential roll-ups involving competitors, as well as other strategic transactions.</p>
<p style="padding-left: 30px;">I have the greatest confidence in Herbalife’s CEO, Michael Johnson, and the entire management team, who have skillfully led the Company through adversity, including holding firm against a high-profile PR campaign against the Company by Bill Ackman where it was alleged more than once that the Company would be shut down. Obviously, we are still here. I genuinely commend management’s steadfastness in the face of short sellers desperate to rally a bear raid based on false accusations. The short-sellers should also note that since joining the Board three years ago, we have paid attention to their accusations and while the vast majority have been baseless, a handful of their points were valid and the Company has made appropriate changes. Interestingly, ending and modifying certain practices has not hurt earnings one iota.</p>
<p style="padding-left: 30px;">Herbalife produces some of the finest nutrition products in the world and its direct sales model gives people an opportunity, either full- or part-time, to start their own business. Without the Herbalife sales opportunity many of these people would be unemployed or otherwise have a difficult time finding work. In my teens I spent several summers working as a Fuller Brush man going door to door often working 12 hours per day. I ended up earning more during the summer than my father. Many of my friends who also started with me but were not willing to work as hard failed as salesmen. But no one would believe their failure made Fuller Brush a “bad” company. Fuller Brush, much like Herbalife, provided many people with potential income opportunities where such opportunities may not have otherwise existed. Just because not everyone can be successful selling Herbalife products does not mean Herbalife is a “bad” company.” I believe that now the cloud over Herbalife is gone, the Company will continue to grow and continue to provide much needed employment for many more hard-working people."</p><p><a href="http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/bitcoin-cryptocurrency-value-digitization-of-everything-lex-sokolin-2017-11">Cryptocurrency is the next step in the digitization of everything — 'It’s sort of inevitable'</a></p> http://www.businessinsider.com/ackman-actually-herbalife-is-a-pyramid-scheme-2016-7ACKMAN: Actually, Herbalife is a pyramid schemehttp://www.businessinsider.com/ackman-actually-herbalife-is-a-pyramid-scheme-2016-7
Fri, 15 Jul 2016 13:48:05 -0400Rachael Levy
<p><img style="float:right;" src="http://static3.businessinsider.com/image/57891a0e4321f1480f8b8880-2400/ap_698344155679.jpg" alt="Bill Ackman" data-mce-source="Manuel Balce Ceneta/AP" data-link="http://www.apimages.com/metadata/Index/Valeant-Congress/83e621416cc84348ad39a9d17ec9e542/6/0" /></p><p>Bill Ackman is digging in.</p>
<p>After the Federal Trade Commission on Friday reached a settlement with Herbalife &mdash; the multilevel marketing company &mdash; Ackman's hedge fund said the findings "constitute a pyramid scheme."</p>
<p>The FTC specifically didn't call Herbalife a pyramid scheme. But, as Pershing Square's spokesman also said on Friday, the FTC also <em>didn't not</em> call it a pyramid scheme.</p>
<p>And the FTC did ask Herbalife to make some changes to its marketing and the way it rewards its members.</p>
<p>"While it appears that Herbalife negotiated away the words 'pyramid scheme' from the settlement agreement, the FTC's findings are clear," Pershing Square's statement said.</p>
<p>The activist investor has long framed Herbalife as a fraudulent company, placing a $1 billion short-sale bet against its stock and spending millions to convince others of its misdeeds. So Ackman had a lot to gain if the FTC had agreed to label Herbalife a pyramid scheme and shut it down.</p>
<p>Instead, he's losing money. Herbalife shares are up about 20% for the year so far, with half that gain coming after news of the settlement.</p>
<p>But the hedge fund isn't losing hope on its bet, saying that Herbalife's settlement includes a business restructuring that "will cause the pyramid to collapse as top distributors and others take their downlines elsewhere or otherwise quit the business."</p>
<p>On that front, Ackman may have a point. After all, if the changes the FTC asked for are fundamental enough to Herbalife's success, this could cause it trouble.</p>
<p>Under <a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7">the settlement</a>, Herbalife must get rid of incentives that reward distributors primarily for recruiting, the FTC said. The new compensation structure would depend on whether participants sell Herbalife products, not on whether they buy.</p>
<p>Time will tell &mdash; not that this is much comfort for Pershing Square's investors. The hedge fund was down about 20% last year off losing bets, its worst year ever, with similar losses continuing through this year.</p><p><a href="http://www.businessinsider.com/ackman-actually-herbalife-is-a-pyramid-scheme-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/cryptocurrency-value-explained-by-crypto-hedge-fund-cio-ari-paul-2017-11">The CIO of a crypto hedge fund explains the value in cryptocurrency — and why the market will explode over the next 2 years</a></p> http://www.businessinsider.com/short-selling-is-about-timing-2016-7The Herbalife saga shows that Bill Ackman thinks he's too good for short sellinghttp://www.businessinsider.com/short-selling-is-about-timing-2016-7
Fri, 15 Jul 2016 12:47:40 -0400Linette Lopez
<p><img style="float:right;" src="http://static2.businessinsider.com/image/57890b2a88e4a725238b8314-2400/rtxtfo4.jpg" alt="bill ackman" data-mce-source="REUTERS/Shannon Stapleton" data-mce-caption="Hedge fund manager William Ackman of Pershing Square Capital Management smiles during an interview in New York September 27, 2010. " /></p><p>Wall Street knows that short selling is a dangerous game. Because they are borrowing a stock, not simply owning it, short sellers risk losing more than the money they put down.</p>
<p>Some great investors don't even touch the stuff.</p>
<p>And on Friday, Pershing Square's Bill Ackman gave them another reason to hold their noses. He lost his three-year campaign against the multilevel marketing nutrition company Herbalife after the <a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7">Federal Trade Commission and the company reached a deal</a> in which the company avoided being called a pyramid scheme &mdash; Ackman had told Wall Street in no uncertain terms that the stock was going to zero.</p>
<p>Telling everyone his belief was the problem.</p>
<p>That promise to ride the stock all the way down took away the only magic power a short seller has &mdash; the ability to manipulate time. Try asking why a short seller decided to go public on a specific position at a certain time. The person won't tell you. The short seller might tell you how to theoretically consider timing, but that's like explaining to someone why planes can take off the ground. You get it, sure, but that doesn't mean you will build one and fly away.</p>
<p>You can see that the structure of the campaign made it impossible for Ackman to manipulate timing. It was never his intention to allow people to forget that he was holding the position (the fickleness of memory is another one of the short seller's greatest weapons).</p>
<p>Perhaps you recall this fun three-hour, <a href="http://www.businessinsider.com/what-the-heck-happened-to-bill-ackman-2014-7">live-streamed, Herbalife-bashing party</a> Ackman threw back in the summer of 2014, more than a year after he had announced the position and gotten into a verbal altercation with Carl Icahn on live television.</p>
<p style="padding-left: 30px;">"...everyone who showed up for Ackman's Tuesday presentation &mdash; or tuned into the internet livestream &mdash; remembered what Icahn said on TV over a year before.</p>
<p style="padding-left: 30px;">"They remembered it as Ackman's talk passed the hour mark, then the two-hour mark and the three-hour mark.</p>
<p style="padding-left: 30px;">"They remembered it as Ackman compared Herbalife's top brass to everything from Nazis to Mafiosos and drug dealers. And they remembered it as they watched Herbalife's stock rocket up 24% for the day, making a mockery of Ackman's crusade.</p>
<p style="padding-left: 30px;">"They remembered it when Ackman &mdash; describing his family's connection to the American Dream as the presentation (almost) neared its climax &mdash; actually cried."</p>
<p>How's anyone ever going to forget about that?</p>
<p><img src="http://static4.businessinsider.com/image/53ceeea26da811ad1f8b4567-800/452525522.jpg" alt="bill ackman" data-mce-source="Bloomberg via Getty Images" /></p>
<h2>Eat my (activist) shorts</h2>
<p>What's funny about all of this is that Ackman went on CNBC on Thursday and criticized Citron Research's Andrew Left for doing the very thing he was too righteous to do in this campaign &mdash; for manipulating time.</p>
<p>Left, you'll recall, is the man whose questions about Valeant's accounting back in October set off a series of events that brought the company, another Ackman position, to its knees. Earlier this week Left said he had initiated a short position in the company once again after going long. Ackman scoffed at this.</p>
<p>"Look, I think Andrew Left is a charismatic guy," Ackman said. "And he made one of the great short calls ... ever. I give him enormous credit for that, and then he made a long call on Valeant, and then he made a short call on Valeant.</p>
<p>"What I find interesting is he never tells you what he does with his position. So obviously, he puts the trade on. He goes on CNBC says it's a short, then he covers and then he puts the position &mdash; buys some calls or goes long the stock and then he goes on TV and says it's a long, which he did, I don't know, maybe a month or two ago. And then I guess yesterday it's short again. I just feel like you guys are doing a very good job helping him make money on his portfolio."</p>
<p>And so Ackman, a man who regularly holds press conferences in packed auditoriums to discuss his portfolio, is accusing someone else of showboating.</p>
<p>What's really crazy here is that Ackman just described a principle of short selling as if it's something he's too good for. In discussions following the ruling, I mused with a friend on how quickly Left was in and out of positions. Neither of us were exactly sure how long he likes to hold. Maybe he's in and out of there, we thought.</p>
<p>The fact that we even wondered that means he's doing his job as a short seller, appearing and then disappearing from the market as he chooses.</p>
<p>Perhaps now Ackman will consider disappearance more carefully if he ever shorts a stock again.</p>
<p>But as I said, even some of the greatest investors in the world simply don't do it all. Perhaps Ackman is one of the great investors who doesn't know how to disappear.</p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/what-the-heck-happened-to-bill-ackman-2014-7" >What the heck happened to Bill Ackman</a></strong></p>
<p><a href="http://www.businessinsider.com/short-selling-is-about-timing-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/economist-jim-rickards-bitcoin-versus-gold-price-manipulation-2017-12">Economist Jim Rickards on gold versus bitcoin — intrinsic value is meaningless for both but the bitcoin prices aren't real</a></p> http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7The epic war between Bill Ackman and Carl Icahn is over, and Icahn won (HLF)http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7
Fri, 15 Jul 2016 10:40:17 -0400Portia Crowe
<p><img style="float:right;" src="http://static2.businessinsider.com/image/5788fc7c4321f16c018b8895-840/icahn%20ackman_edited-1.jpg" alt="Carl Icahn Bill Ackman" data-mce-source="Reuters"></p><p>Bad news for Bill Ackman.</p>
<p>The Federal Trade Commission on Friday <a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7">reached an agreement with multilevel marketing firm Herbalife, that kept it from being labeled a pyramid scheme</a>.</p>
<p><span>Ackman, the founder of Pershing Square Capital Management, has been short Herbalife <a href="http://www.businessinsider.com/bill-ackmans-herbalife-presentation-2012-12">since December 2012</a>, when he made a $1 billion bet that the stock would go to $0 and began a campaign to convince regulators and investors of wrongdoing by the company.</span></p>
<p>Fellow billionaire and activist investor Carl Icahn <a href="http://www.businessinsider.com/carl-icahn-is-long-herbalife-2013-1">took the other side of that bet</a> several weeks later.</p>
<p>Their opposing views on the company have led to some heated exchanges, including a January 2013 conversation on CNBC in which Icahn called Ackman a "crybaby" on live television. <br><br><div>
<iframe width="854" height="480" src="//www.youtube.com/embed/hCZRk1lL90Q" frameborder="0" allowfullscreen></iframe>
</div></p>
<p>They have since de-escalated, <a href="http://www.businessinsider.com/bill-ackman-and-carl-icahn-are-on-stage-at-a-huge-hedge-fund-conference-2014-7">hugging on stage</a> at a conference in 2014.</p>
<p>And Herbalife wasn't let completely off the hook by the FTC.<span> The company</span> must pay $200 million to settle charges and abandon incentives that reward distributors primarily for recruiting rather than sales. It also has to change some marketing practices.</p>
<p><span>The FTC's complaint showed that half of Herbalife's top sales leaders earned less than $300 on average in 2014 and were encouraged to recruit more sellers regardless of whether there was consumer demand.</span></p>
<p>So, Ackman — who had made the recruitment of sellers a key plank in his effort to have it deemed a pyramid scheme — was partially vindicated. </p>
<p>But lets remember that this is about investment profits. And on that front the outcome is clear.</p>
<p>Herbalife's shares jumped nearly 20% following the news Friday, and they're up nearly 70% since just before Ackman's short position became public.</p>
<h2>Icahn wins this one </h2>
<p>Icahn, who is now the company's largest shareholder with an 18% stake, has been granted permission to own as much as 35%.</p>
<p>"<span>While Bill Ackman and I are on friendly terms, we have agreed to disagree (vehemently) on this subject," Icahn said in a </span><a href="http://carlicahn.com/carl-icahn-issues-statement-in-response-to-herbalifes-settlement-with-the-ftc/">statement</a> released Friday<span>. "Simply stated, the shorts have been completely wrong on Herbalife."</span></p>
<p><span>In a statement released Friday, Ackman said that the FTC's findings still constitute a pyramid scheme, despite the regulator not using that term.</span></p>
<p><span>"We expect that once Herbalife's business restructuring is fully implemented, these fundamental structural changes will cause the pyramid to collapse as top distributors and others take their downlines elsewhere or otherwise quit the business," he said.</span></p>
<p><span>That mirrored what he had said on Thursday.</span></p>
<p><span>"Every day thousands of Herbalife distributors go on the web to host webinars and they attempt to recruit people with false and misleading statements about the potential of Herbalife business opportunities," Ackman said on <a href="http://video.cnbc.com/gallery/?video=3000534409">CNBC's Halftime Report</a>.</span></p>
<p><span>He referenced the $200 million settlement number that Herbalife had previously hinted at, adding:</span></p>
<p style="padding-left: 30px;"><span>"That's what they would be willing to pay in a mutual resolution. <strong>That's not what the government is willing to accept.</strong> That's what they have apparently thrown out as a number they're willing to pay. The reality here is this is not going to be about a dollar amount that Herbalife pays to the government to resolve this. The only way this thing gets resolved in my opinion is if Herbalife make material changes to their incentive structure to stop the incentives to recruit and my guess is that's what the government is pushing for. <strong>Herbalife realizes it can't accept those changes or they'll go bankrupt because no one is actually buying the product — you can't make money selling the product at retail. This is going to end up with the government suing Herbalife for being a pyramid scheme or Herbalife capitulating and agreeing to changes.</strong> And in either circumstance, the stock is not going to be $60 a share and trading at 14.5x earnings. That's why, certainly, we've been a patient investor here. I think this is the most attractive Herbalife has been from a risk rewards standpoint and that's why we've stayed short. And if we felt it wasn't an attractive investment we would have covered a long time ago."</span></p>
<p><span>Herbalife's shares have increased from $42.50 on December 18, 2012, the day before Ackman confirmed his short position, to <span>about $71 around 10 a.m. ET Friday. </span></span></p>
<p><span><span><img src="http://static5.businessinsider.com/image/5788ef6688e4a779638b7fe9-1236/screen_shot_2016-07-15_at_10_03_35_am.jpg" alt="Screen_Shot_2016 07 15_at_10_03_35_AM" data-mce-source="Yahoo! Finance"></span></span></p>
<p>Here's Icahn's full statement:</p>
<p style="padding-left: 30px;">"I have always believed in Herbalife’s strong fundamentals and am pleased the Board has decided to increase my ownership limit from 25% to 34.99% of the Company’s outstanding shares. A significant part of my investment success is directly tied to our in-depth investment research and understanding of often complex and unique issues facing companies. One can be sure that this was the case with Herbalife where we spent considerable time and resources studying the false pyramid scheme accusations made against the Company. Unlike many of those that “shorted” Herbalife, we did not rely on one or two research papers prepared by non-experts. As a result of our research, over three years ago we concluded that Herbalife was not a pyramid scheme. The FTC settlement announced today, coming after a two-year investigation also concluded that Herbalife is not a pyramid scheme – a conclusion that obviously vindicates our research and conviction. While Bill Ackman and I are on friendly terms, we have agreed to disagree (vehemently) on this subject. Simply stated the shorts have been completely wrong on Herbalife. Now that the Company has reached a settlement with the FTC, it is time to consider a range of strategic opportunities, including potential roll-ups involving competitors, as well as other strategic transactions.</p>
<p style="padding-left: 30px;">I have the greatest confidence in Herbalife’s CEO, Michael Johnson, and the entire management team, who have skillfully led the Company through adversity, including holding firm against a high-profile PR campaign against the Company by Bill Ackman where it was alleged more than once that the Company would be shut down. Obviously, we are still here. I genuinely commend management’s steadfastness in the face of short sellers desperate to rally a bear raid based on false accusations. The short-sellers should also note that since joining the Board three years ago, we have paid attention to their accusations and while the vast majority have been baseless, a handful of their points were valid and the Company has made appropriate changes. Interestingly, ending and modifying certain practices has not hurt earnings one iota.</p>
<p style="padding-left: 30px;">Herbalife produces some of the finest nutrition products in the world and its direct sales model gives people an opportunity, either full- or part-time, to start their own business. Without the Herbalife sales opportunity many of these people would be unemployed or otherwise have a difficult time finding work. In my teens I spent several summers working as a Fuller Brush man going door to door often working 12 hours per day. I ended up earning more during the summer than my father. Many of my friends who also started with me but were not willing to work as hard failed as salesmen. But no one would believe their failure made Fuller Brush a “bad” company. Fuller Brush, much like Herbalife, provided many people with potential income opportunities where such opportunities may not have otherwise existed. Just because not everyone can be successful selling Herbalife products does not mean Herbalife is a “bad” company.” I believe that now the cloud over Herbalife is gone, the Company will continue to grow and continue to provide much needed employment for many more hard-working people."</p><p><a href="http://www.businessinsider.com/icahn-has-won-the-war-with-ackman-over-herbalife-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/ico-initial-coin-offering-overvalued-crypto-hedge-fund-ari-paul-blocktower-2017-12">The CIO of a crypto hedge fund reveals why you should be cautious of the ICO bubble</a></p> http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7Herbalife escaped being called a pyramid scheme and its shares are soaring (HLF)http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7
Fri, 15 Jul 2016 09:38:00 -0400Akin Oyedele
<p><img style="float:right;" src="http://static3.businessinsider.com/image/56d82e156e97c630008bb0f1-1024/21688729261_3e1090b8bf_b.jpg" alt="herbalife" data-mce-source="HERBALIFE (Independent Distributor)/Flickr" data-link="https://www.flickr.com/photos/goherb/21688729261/in/photolist-z3ypzX-nGG4bz-noq72E-geMxDC-noq673-bCsSZb-qt9JHK-oDxp5R-jaWKWq-bRnzL8-mSyGr1-nEUEBp-poPAXG-bCsT8q-qkCAVv-bRofSR-bCsTgh-hXXo2w-mbcd64-nUdaix-arYbCi-dR8c7A-jzBJB5-bRnAnp-oBmsiP-fH9vts-y66qQi-pP776o-qd1koq-bufyY2-y5CEWQ-dMhE4o-qEvjjc-qtkg2p-uiLqLs-mbdLHr-mbcb3P-61sceL-4wdw5p-agCacJ-arYbkk-bCtymj-rdJTS1-61scVs-61sc6m-mbejv5-rjv3Y7-qFvsWo-61o1SV-yKbpcW" /></p><p>The Federal Trade Commission has reached an agreement with Herbalife, that kept it from being labeled a pyramid scheme.</p>
<p>In a <a href="https://www.ftc.gov/news-events/press-releases/2016/07/herbalife-will-restructure-its-multi-level-marketing-operations">release</a> on Friday, the FTC said Herbalife, a multilevel marketing firm that sells nutritional supplements, will restructure its operations and pay $200 million. It will have to change some of its marketing tactics and its reward system for sales leaders.</p>
<p>The FTC <a href="http://www.businessinsider.com/r-herbalife-says-it-is-in-talks-with-ftc-outcome-uncertain-2016-2">opened a probe</a> into the company after hedge fund manager Bill Ackman alleged that it operated like a pyramid scheme&nbsp;&mdash; which would be illegal.<br /><br />Ackman began his crusade against Herbalife in December 2012, with a $1 billion bet the stock would fall.</p>
<p>The shares jumped over 17% following the news Friday, rising to their&nbsp;highest level since early 2014.&nbsp;</p>
<p>The FTC's complaint showed that half of Herbalife's top sales leaders earned less than $300 on average in 2014 and were encouraged to recruit more sellers regardless of whether there was consumer demand.</p>
<p>Under the settlement, Herbalife must get rid of incentives that reward distributors primarily for recruiting, the FTC said. The new compensation structure would depend on whether participants sell Herbalife products, not on whether they buy.</p>
<p>Herbalife's board granted Carl Icahn, the billionaire investor who was already the company's largest shareholder with an 18% stake, the right to increase his ownership to as much as 35%.</p>
<p>"While Bill Ackman and I are on friendly terms, we have agreed to disagree (vehemently) on this subject," Icahn said in a <a href="http://carlicahn.com/carl-icahn-issues-statement-in-response-to-herbalifes-settlement-with-the-ftc/">statement</a>. "Simply stated, the shorts have been completely wrong on Herbalife."</p>
<p>In July 2014, Ackman published a <a href="http://www.businessinsider.com/bill-ackman-herbalife-slides-2014-7#-1">235-page slide deck</a> detailing why Herbalife was "the big lie."</p>
<p><img src="http://static3.businessinsider.com/image/5788e72288e4a7fd018b84b9-955/screen shot 2016-07-15 at 9.34.23 am.png" alt="Screen Shot 2016 07 15 at 9.34.23 AM" data-mce-source="Google Finance" /><br /><br /></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/ackman-shades-andrew-left-2016-7" >Bill Ackman threw serious shade at the short seller who tanked Valeant</a></strong></p>
<p><a href="http://www.businessinsider.com/the-ftc-has-decided-that-herbalife-is-not-a-pyramid-scheme-2016-7#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/exercise-pill-will-help-injured-sick-atrophy-muscle-testing-therapy-2015-11">Scientists are developing a pill that tricks your body into thinking it has exercised</a></p> http://www.businessinsider.com/icahn-says-ackman-wrong-on-herblife-2016-6Carl Icahn kicks Bill Ackman while he's downhttp://www.businessinsider.com/icahn-says-ackman-wrong-on-herblife-2016-6
Thu, 09 Jun 2016 09:41:21 -0400Linette Lopez
<p><img style="float:right;" src="http://static1.businessinsider.com/image/57596eab91058428008c7d07-781/screen shot 2013-07-18 at 10.16.18 am.png" alt="Carl Icahn" data-mce-source="via CNBC" /></p><p>Things were obviously getting a little too boring around Wall Street for Carl Icahn.</p>
<p>The billionaire investor and founder of Icahn Enterprises decided on Thursday to dredge up one of his old feuds.</p>
<p><a href="https://twitter.com/CNBCnow/status/740889639096045568">He told CNBC</a> that Pershing Square's Bill Ackman was "dead wrong" in his short position in Herbalife, a multilevel marketing firm that sells nutritional supplements.</p>
<p>Of course, he also prefaced this by saying that Ackman was a "smart guy."</p>
<p>"Ackman is completely and totally wrong on this company," he said. "You know, Ackman is a smart guy and all, but he is just dead wrong. This company creates work for a lot of people. And to say it doesn't is ridiculous."</p>
<p>Herbalife's stock is up almost 110% since Bill Ackman declared before all of Wall Street in December 2012 that he had taken a short position against the company. It was just one of many positions that have turned against Ackman over the last year and change. In 2015, his hedge fund was down 20% for the year.</p>
<p>Ackman and Icahn have been feuding far longer than that, though. The two fell out over a deal (see: <a href="http://www.businessinsider.com/ackman-icahn-hallwood-contract-2013-1">"schmuck insurance"</a>) after Ackman blew up his first hedge fund, Gotham Partners, in 2001. They sued each other for the next 10 years and, famously, couldn't even be in the same restaurant together.</p>
<p>Their feud ramped up again when Ackman started his crusade against Herbalife, which Ackman accused of being a pyramid scheme. He was very public about the position, giving multiple presentations slamming the company and kicking the whole thing off with <a href="http://www.businessinsider.com/bill-ackmans-herbalife-presentation-2012-12">a 342-slide deck</a> at a special Sohn Conference event in New York City.</p>
<p>Icahn quickly took the other side of the trade, at one point calling Ackman a crybaby on CNBC:</p>
<p style="padding-left: 30px;"><span>"I'm telling you he's like a crybaby in the schoolyard. I went to a tough school in Queens, you know, and they used to beat up the little Jewish boys. He was like one of the little Jewish boys crying that the world is taking advantage of him."</span></p>
<p>It all ended two years later with what was, without question, <a href="http://www.businessinsider.com/bill-ackman-and-carl-icahn-are-on-stage-at-a-huge-hedge-fund-conference-2014-7">the most awkward hug in Wall Street history.</a></p>
<p><img src="http://static5.businessinsider.com/image/53c6f04cecad043e7cf996b7-1510/screen shot 2014-07-16 at 5.24.27 pm.png" alt="ackman icahn" data-mce-source="CNBC" /></p>
<p>To be fair, Icahn isn't having the greatest year either. In May, Standard &amp; Poor's cut Icahn Enterprises' <a href="http://www.businessinsider.com/carl-icahn-is-officially-junk-2016-5">credit rating to junk.</a> He's lost big on positions in energy stocks.</p>
<p><span>"We estimate that after quarter-end through May 13, 2016, IEP's large publicly traded positions declined by approximately $600 million, which would result in an LTV ratio of about 53%, holding all else equal," S&amp;P's release said.</span></p>
<p><span>On the other hand, things <em>have</em> been a little boring around here.</span></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/diversity-on-wall-street-2016-6" >This has been the worst year for Wall Street's 'bros' in a long time</a></strong></p>
<p><a href="http://www.businessinsider.com/icahn-says-ackman-wrong-on-herblife-2016-6#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/warren-buffett-modest-home-bought-31500-looks-2017-6">Warren Buffett lives in a modest house that's worth .001% of his total wealth — here's what it looks like</a></p> http://www.businessinsider.com/report-herbalife-ftc-agreement-2016-5Herbalife is surging after a report that the company has settled its FTC investigation (HLF)http://www.businessinsider.com/report-herbalife-ftc-agreement-2016-5
Tue, 24 May 2016 12:01:01 -0400Akin Oyedele
<p><img style="float:right;" src="http://static4.businessinsider.com/image/56d82e156e97c630008bb0f1-1024-768/21688729261_3e1090b8bf_b.jpg" alt="herbalife" data-mce-source="HERBALIFE (Independent Distributor)/Flickr" data-link="https://www.flickr.com/photos/goherb/21688729261/in/photolist-z3ypzX-nGG4bz-noq72E-geMxDC-noq673-bCsSZb-qt9JHK-oDxp5R-jaWKWq-bRnzL8-mSyGr1-nEUEBp-poPAXG-bCsT8q-qkCAVv-bRofSR-bCsTgh-hXXo2w-mbcd64-nUdaix-arYbCi-dR8c7A-jzBJB5-bRnAnp-oBmsiP-fH9vts-y66qQi-pP776o-qd1koq-bufyY2-y5CEWQ-dMhE4o-qEvjjc-qtkg2p-uiLqLs-mbdLHr-mbcb3P-61sceL-4wdw5p-agCacJ-arYbkk-bCtymj-rdJTS1-61scVs-61sc6m-mbejv5-rjv3Y7-qFvsWo-61o1SV-yKbpcW" /></p><p>Herbalife shares jumped by as much as 8% in trading Tuesday following a report that the company has reached a settlement agreement with the Federal Trade Commission.&nbsp;</p>
<p>The <a href="http://nypost.com/2016/05/24/herbalife-reaches-preliminary-settlement-with-ftc/">New York Post</a> reported, citing someone familiar with the matter, that Herbalife reached an agreement in principle to settle an investigation into whether it is an alleged pyramid scheme.&nbsp;</p>
<p>An announcement of a deal could come later Tuesday although nothing is final yet, the Post reported, adding that Herbalife has agreed to a hefty fine.&nbsp;</p>
<p>The FTC <a href="http://www.businessinsider.com/r-herbalife-says-it-is-in-talks-with-ftc-outcome-uncertain-2016-2">opened a probe</a> into the company after hedge fund manager Bill Ackman alleged that Herbalife&nbsp;operated like a pyramid scheme. The company sells weight-management products through a network of independent distributors who earn sales commissions.&nbsp;</p>
<p>Herbalife said in a regulatory filing in February that it was in talks to potentially resolve the probe.&nbsp;</p>
<p>CNBC's Scott <a href="https://twitter.com/CNBCnow/status/735140659598876674">Wapner</a> and Fox Business News' Charles <a href="https://twitter.com/CGasparino/status/735140357856366592">Gasparino</a> said, citing sources, that the report of a settlement is untrue.&nbsp;</p>
<p>Herbalife was not&nbsp;immediately available for comment.&nbsp;</p>
<p>Here's a chart showing the spike in trading:<img src="http://static5.businessinsider.com/image/57447a5e9105842a008c4baa-940-527/screen shot 2016-05-24 at 11.57.16 am.png" alt="Screen Shot 2016 05 24 at 11.57.16 AM" data-mce-source="Google" /></p><p><a href="http://www.businessinsider.com/report-herbalife-ftc-agreement-2016-5#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/blackrock-chief-fixed-income-strategist-on-tax-reform-and-the-federal-reserve-2017-11">We talked to the bond chief at the $6 trillion fund giant BlackRock about the most important issue for markets right now</a></p>